Production and Costs: Applied Analysis Online Quiz Questions

True or false: In economics, the short run is defined as a specific number of calendar months that is the same for every firm.

Which cost is most likely variable in the short run for a factory that hires workers as production expands?

A firm’s total product rises from 30 units to 38 units when it adds one more worker. What is the marginal product of that worker?

Select all the factors that can produce economies of scale as a firm expands in the long run.

True or false: If marginal cost is below average total cost, average total cost is falling.

What is the economic term for the opportunity cost of an owner’s time when the owner works in the business without receiving a salary?

Select all statements that correctly describe standard short-run total-cost curves.

Explain why average total cost can eventually rise even though average fixed cost continues to fall as output increases.

Which statement best describes a firm’s production function?

Select all statements that are consistent with long-run planning for a firm.

True or false: In the short run, at least one input is fixed.

Which cost is most likely a variable cost for a bakery in the short run?

What economic term describes the situation in which each additional worker eventually adds less output while the food truck and its equipment remain fixed?

True or false: Average fixed cost continuously decreases as output increases, assuming fixed cost is unchanged.

A firm has fixed cost of $100 and variable cost of $70 at an output level. What is its total cost at that output level?

Using the worked cost table, what is the marginal cost in dollars when output increases from 3 units to 4 units? Enter the exact dollar value; no rounding is needed.

A firm has total cost of $220 when it produces 4 units. What is its average total cost in dollars per unit? Enter the exact value; no rounding is needed.

A firm's long-run average cost rises as its output expands. Which scale condition does this describe?

In the food-truck production table, how many additional units of output does the fifth worker produce? Enter the exact number of units.

True or false: Economic cost includes both a firm's explicit monetary payments and the opportunity costs of resources supplied by its owners.

The next unit of output would generate $45 in additional revenue and has a marginal cost of $30. What is the immediate effect of producing that unit on profit?

A bakery can hire more workers immediately, but it cannot change the size of its building during the period being considered. Which production period is this?

A firm has fixed cost of $80 and variable cost of $50 when it produces 2 units. What is its total cost at that output?

A food truck's total product is 10 meals with 1 worker and 24 meals with 2 workers. What is the marginal product of the second worker?

The next unit of output would generate $45 in additional revenue and have a marginal cost of $60. If the firm produces that unit, what happens to profit?

If marginal cost is below average total cost at a firm's current output, what must be happening to average total cost?

A firm's long-run average cost falls as its output expands from 1,000 units to 2,000 units. Which condition does this demonstrate?